Intel hits AMD with patent breach claim

AMD piled more worries on its shareholders and partners today when it revealed that Intel is threatening to pull a 2001 cross-licensing agreement between the two firms.

In an SEC filing, AMD said it had received "correspondence" from Intel relating to the firm's 2001 Patent Cross License Agreement, which "(i) alleges that the Company has committed a material breach of the Cross License through the creation of the Company's GLOBALFOUNDRIES joint venture and (ii) purports to terminate the Company's rights and licenses under the Cross License in 60 days if the alleged breach has not been corrected".

GLOBALFOUNDRIES is what used to be AMD's chip making business, which the firm spun-out recently in partnership with that well-known Silicon Valley player, the government of Abu Dhabi.

AMD did not detail the nature of the breach, which it in any case insists it hasn't actually made. However, it might be a fair guess that Intel is keen to ensure that none of its IP is hawked to other companies via GLOBALFOUNDRIES.

An Intel spokesman said in a statement, "Intel believes that the formation of Global Foundries is not a subsidiary under terms of the agreement and is therefore not licensed under a 2001 patent cross license agreement and that AMD violated the agreement.

Intel said it was happy to license IP, "However Intel does not believe AMD can unilaterally extend Intel's rights to a 3rd party without Intel's consent."

Intel would, presumably, prefer to do any such IP prolifertion itself - as it recently did with TSMC.

AMD will keep the legal merrygoround spinning, maintaining "that Intel's purported attempt to terminate the Company's rights and licenses under the Cross License itself constitutes a material breach of the Cross License by Intel which gives the Company the right to terminate Intel's rights and licenses under the Cross License Agreement while retaining the Company's rights and licenses under the Cross License Agreement".

The two firm's legal departments are no strangers to each other. Apart from the latest patent dispute, the two firms have long running anti-trust disputes, most prominently in Europe.

AMD and Intel spent most of the 1990s suing each other after AMD used a co-processor agreement with Intel to leap full scale into the x86 processor market.

For most of this decade, the two have maintained reasonably friendly relations - the antitrust actions apart.

This is presumably in part because it is Intel's interests that AMD continue to provide some competition in the x86 market. And it is this interest in diverting the eyes of antitrust investigators that will probably mean the latest issue will be resolved. ®